Note: This document may not always reflect the actual appropriations determined by Congress. Final budget allocations for USAID's programs are not determined until after passage of an appropriations bill and preparation of the Operating Year Budget (OYB).
PERU
FY 1998 Development Planning . . . . . . . . . . . . . . . . . $34,493,000 FY 1998 International Narcotics Control Fund . . . . . . . . . . . . . . . . . $25,000,000 FY 1998 P.L. 480, TITLE II . . . . . . . . . . . . . . . . . $48,917,000 Introduction
The significant progress made in restoring stability and growth in the Peruvian economy over the past several years provides the basis for hope that individual, institutional, and societal capacity can be built to achieve the conditions necessary to promote Peru's sustainable development over the long term. Peru's political, economic, and social stability is important to long-term U.S. interests in the region. Fundamental U.S. foreign policy priorities in Peru include support for its fragile democracy and reduction of coca production and trafficking of coca-based products. USAID's development assistance to Peru directly addresses these interests through programs to strengthen democracy and to development alternatives to coca production. There also are important U.S. interests in extending the benefits of economic growth to the poor and in expanding trade and investment opportunities. USAID assistance, supports these objectives by promoting programs to increase incomes of the poor; reduce population growth rates; improve health and nutrition, and human capacity development; and ensure appropriate stewardship of natural resources, including biodiversity.The Development Challenge
Poverty, underemployment, low productivity, lack of access to quality education, malnutrition, and high levels of preventable mortality and morbidity remain serious impediments to Peru's sustainable development, despite recent economic progress. The number of Peruvians living below the poverty threshold was 11.3 million in 1995, or 50% of the population, down from 55% in 1991. Those living in extreme poverty dropped from 24% to 19% during the same period. Although unemployment affects 9% of the economically active population, 46% are underemployed. The national rate of chronic malnutrition among school children is 48% and, in some highland departments is 72%. National life expectancy is 10% lower than in neighboring middle-income countries, while infant and child mortality are twice as high. Fertility remains high in rural areas. The high maternal mortality and morbidity associated with the termination of unwanted pregnancies evidence a continuing unmet need for family planning services.Economic progress achieved over the past several years has been substantial. A downward trend in economic activity was reversed in 1993, with a Gross Domestic Product (GDP) growth rate of 6.5% for that year, and 13% for 1994. The Government of Peru (GOP) slowed this rate to an estimated 7% for 1995, to harness GDP growth at a more sustainable level, as well as to control rapid growth of fiscal expenditures and current account deficit. GOP preliminary projections estimate a 2.5% growth rate for 1996. Inflation declined from 7,650% in 1990 to 10.2% in 1995. Inflation is expected to reach 12% and 9% in 1996 and 1997, respectively. Nevertheless, to sustain growth GOP institutions must be modernized to improve their capacity to develop and implement reforms and programs and political power must be decentralized to improve the responsiveness of government institutions to local development needs. Peru's future growth potential also depends greatly on its ability to manage natural resources for long-term sustainable use.
Peru's foreign debt rose from $20.7 billion in 1990 to $32.1 bilion in 1995. The sharpest debt increase occurred in 1995 when the GOP resumed payment of past due interest on its commercial debt. Continued debt service payment will require the GOP to adhere to sound economic policies leading to sustained annual growth exceeding 5%.
The human rights situation in Peru has improved dramatically, although concerns remain. The recent selection of the members of the Constitutional Tribunal and an independent Human Rights Ombudsmanare important milestones. The establishment of the Pardon Commission holds promise of pardon to persons unjustly accused or convicted of terrorism.
Peru remains the world's leading producer of coca leaf with an estimated gross effect on the economy of approximately $1 billion, or more than 2% of GDP in 1995. The United Nations (UN) estimates that the drug industry, including cultivation, processing, and transportation, accounts for up to 11% of GDP. Coca leaf production and trafficking continues to cause serious social, economic, political, and environmental harm to Peru. Domestic drug abuse is expanding at a high rate, further compounding Peru's social problems. Deforestation, erosion and disposal of toxic chemicals resulting from the processing of coca are causing ecological damage in these areas.
Program resource levels are projected to decline over the life of the USAID strategy for Peru leading to various graduation rates. The program will focus more attention between the years 2000 - 2005 on policy and institutional development to bring Peru into a new hemispheric trade agreement. By 2005, social, economic, and political conditions, as well as civil society and public sector institutional capacity at the national and local levels, will have developed sufficiently to permit an orderly withdrawal of assistance in most areas of USAID concern, including P.L. 480 Title II. Notable exceptions are the environment and alternative development, for which achievement of conditions for USAID withdrawal will likely require significant assistance until 2010.
Other Donors
Net official development assistance (ODA) to Peru in 1995 was $427 million, of which the U.S.'s contribution accounted for 18.9%. The United States (U.S.). was the principal non-multilateral development donor. Japan, the UN, Germany, and the European Development Fund provided 48.7% of ODA disbursements, directed principally to human resources development, health and social development, economic support, and humanitarian assistance. In addition, the Inter-American Development Bank (IDB) and the World Bank (WB) played a major role in the country's development efforts in the areas of economic support, road rehabilitation, education and social development.FY 1998 Program
The FY 1998 program continues to support Peru in its efforts to: build a participatory democracy and modern state; reduce poverty and illicit coca production while protecting the environment; improve the health of high-risk populations; and better manage the country's vital natural resources.USAID supports five closely integrated objectives directly related to Agency Goals: 1) Broader Citizen Participation in Democratic Processes; 2) Increased Incomes of the Poor; 3) Improved Health, including Family Planning, of High-Risk Populations; 4) Improved Environmental Management in Targeted Sectors; and a Special Objective to Reduce Illicit Coca Production in Target Areas in Peru. The special objective supports the U.S. Government's overriding foreign policy and domestic drug abuse control objectives in counternarcotics, aimed at reducing cocaine production destined for the U.S.
Agency Goal: Sustainable Democracies Built
During the past few years, Peru has achieved some notable successes, such as a series of free and fair elections, improvements in the human rights situation, and establishment of new judicial institutions, including the Human Rights Ombudsman. However, Peru's democracy remains fragile and uneven. Its development is constrained by weaknesses of an unresponsive public sector and lack of participation by civil society groups and individuals. The public sector suffers from an imbalance of power weighted heavily toward the executive, an overly centralized system, and limited political will to institutionalize democratic reforms. A large percentage of citizens need greater skill, knowledge, and opportunities to promote their interests. A number of democracy-related groups in the past had been marginalized, but are now seeking to find ways to participate effectively. The challenge is how to continue and accelerate the process of rebuilding public confidence in participatory democracy and democratic institutions, overcoming the above-mentioned constraints. USAID/Peru focuses on these concerns by supporting activities designed to promote greater access to justice, increase civic awareness, and promoting more accountable public institutions at the central and local government levels to make them more responsive to their constituents.In 1996, major successes occurred in the electoral system, human rights treatment and public civic awareness. Two bills proposing major reforms to the Peruvian electoral system have been drafted and are ready for debate in Congress. A National Elections Board (JNE) decision will allow a referendum on the constitutionality of a recent law which would permit President Fujimori to run for a third term. This constitutes the clearest demonstration of JNE's political independence to date. The Peruvian Congress enacted legislation to create the Pardon Commission, allowing the granting of pardons to persons unjustly accused or convicted of terrorism. So far, 74 people have received pardons. Also, to date, over 1,500 cases have been assumed by USAID-funded legal defense groups and close to 500 persons unjustly detained have been released. Peruvian human rights organizations and the U.S. Government remain concerned about the due process under "faceless" terrorist courts and other practices that induce unfounded accusations.
Strategic Objective 1: Broader Citizen Participation in Democratic Processes Agency Goal: Broad-Based Economic Growth Achieved
USAID's program places great emphasis on incorporating the poor into the expanding market economy to alleviate poverty and reduce food insecurity. Low productivity is a major cause of poverty, which in turn is reflected in inadequate investment in human and physical capital, infrastructure, and supportive public policies and institutions. One complicating factor is the extent of coca production in many rural areas, as Peru remains the world's leading producer of coca leaf. Coca leaf production is a response to poverty, but does not make farmers rich and causes economic distortions that affect the competitiveness of crops and other products, which might otherwise ameliorate poverty.Broad-based increases in incomes will occur only when acutely food insecure Peruvians have greater productive and physical capacities. USAID supports programs to address root causes of poverty by focusing on: (1) improved policies, (2) increased market access, (3) improved capacity of the extremely poor, (4) strengthened organizational outreach, and (5) increased production productivity. Specific actions being carried out will: improve financial institutions for the poor; strengthen local non-governmental and development institutions; develop and disseminate appropriate production technologies and inputs; improved market knowledge and organization; improve nutrition; develop infrastructure; and improve sectoral policies, especially related to marketing, trade, finance, and public revenues and expenditures. Activities funded with P.L. 480 Title II food aid are used to achieve dual humanitarian and development assistance objectives.
Key achievements occurring in 1996 include greater market access by small farmers and microentrepreneurs, with new sales of $29 million in agricultural products and $4 million in non-agricultural products. Over 13,700 new full-time jobs were created. More than 1.3 million food insecure Peruvians two-thirds of whom were children participated in food aid programs. USAID-funded studies have resulted in an improved policy environment for small businesses and microenterprises.
The USAID program responds to major U.S. Government foreign and domestic policy interests to reduce the flow of cocaine to the U.S. Alternative development and law enforcement are the two integral parts of the U.S. Counternarcotics Strategy. The reduction of coca production in target areas will be achieved through implementation of both components. Law enforcement assistance is coordinated by the U.S. Embassy, while the alternative development and drug awareness activities are implemented by USAID. This program is supported by three ongoing activities: The Narcotics Education and Community Initiatives Project (NECI), the Alternative Development Project, and the Local Government Development Project. NECI activities, scheduled to end in 1997, have raised the consciousness of the effects of illegal drug usage in Peru to over 50% of the population. The Local Government Development Project supports this special objective by strengthening local governments, expanding people's participation in decision-making, and creating the public confidence needed to implement sustainable development in the five Alternative Development Project areas.
A special objective promotes alternative licit employment and income sources for those involved in the illicit economy in targeted coca-producing areas. It supports sustainable development activities such as integrated rural development, environmental protection, and drug awareness, which contribute not only to coca reduction, but to improving social, political and economic conditions in those areas. Under the Alternative Development Project, voluntary coca reduction agreements have been signed with 226 communities, representing a reduction commitment of 15,000 hectares, and demonstrating the firm willingness of farmers to abandon their coca production. Other major developments include the drafting of the GOP Alternative Development Plan which details activities for each of the five major coca growing areas and calls for a ten year investment. Also, in 1996 the GOP "Counterdrugs" coordinating office was established and a "drug czar" selected, as called for in the 1994 GOP National Plan for Prevention and Control of Drugs 1994- 2000.
Strategic Objective 2: Increased Incomes of the Poor
Special Objective 1: Reduced Illicit Coca Production in Target Areas of Peru Agency Goal: Stabilizing World Population Growth and Protecting Human Health
The GOP's 1991 - 1992 Demographic Health Survey identified that 72% of married women of child-bearing age have expressed a desire for no more children. This provides the basis for USAID assistance, which is key to stabilizing population growth in Peru over the medium term. USAID support to the major child-survival interventions has a direct impact on mortality and morbidity, especially on high-risk populations. USAID's strong family planning program both reduces unintended pregnancies and, by lowering the number of high-risk births, likewise helps combat maternal mortality. On a national level, infant and child mortality have declined over 40% and fertility by 20% during the last decade. Contraceptive prevalence increased by 33% between 1986 and 1995.
Strategic Objective 3: Improved Health, including Family Planning, of High-Risk Populations Agency Goal: Environment Managed for Long-term Sustainability
Sustainable growth of Peru's economy and the welfare of future generations depend directly on its natural resource base. However, widespread poverty, uncontrolled urbanization, pollution, and lack of adequate environmental policies and public awareness threaten Peru's environment and natural resource base. This strategic objective will enhance management of the environment for long-term sustainability. Notable successes under this strategic objective were achieved during 1996. USAID was instrumental in helping Peru's National Environmental Council, a newly-created public institution, establish its agenda and define its role as the country's leading environmental policy coordinator. Significant progress was achieved in managing protected areas, including the creation of a new national park. Pilot projects for solid waste management and pollution prevention were successfully completed, and other donor funds were leveraged to replicate them. USAID's technical support was critical to draft the GOP's first environmental policy framework for the industrial sector, as well as in completing Lima's first environmental health comparative risk assessment. Environmental awareness in Peru is in a nascent stage of development. Much of the success that the strategic objective will achieve over the next six to eight years is predicated on its ability to secure funding adequate to ensure that the many elements required to stimulate the environmental debate and resolve the country's complex environmental problems can be put into place.
Strategic Objective 4: Improved Environmental Management in Targeted Sectors
PERU
FY 1998 PROGRAM SUMMARY(000's)
USAID Strategic
Objectives
Encouraging
Broad-Based Economic Growth
Stabilizing World Population Growth and Protecting Human Health
Protecting the Environment
Building
Democracy
Providing Humanitarian Assistance
Total 1. Broader Citizen Participation in Democratic
Processes
Development Assistance
International Narcotics
Control
1,900
5,000
1,900
5,000
2. Increased Incomes of the Poor
Development Assistance
International Narcotics
Control
P.L. 480 Title II
6,000
4,000
48,917
6,000
4,000
48,917
3. Improved Health Including Family Planning of High-
Risk Populations
Development Assistance
153
23,040
23,193
4. Improved Environmental Conditions in Targeted
Vulnerable Sectors
Development Assistance
3,400
3,400
Special Objective: 1. Alternative Development
International Narcotics
Control
16,000
16,000
Total Development Assistance
International Narcotics
Control
P.L. 480 Title II
6,153
20,000
23,040
3,400
1,900
5,000
48,917
34,493
25,000
48,917
USAID Mission Director: Eric Zallman
ACTIVITY DATA SHEET PROGRAM: PERU
TITLE AND NUMBER: Broader Citizen Participation in Democratic Processes, 527-SO01
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998: $1,900,000 DA; $5,000,000 INCF INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2002
Purpose: To expand the participation of citizens in the myriad events that affect their lives, while also ensuring that government is more responsive to their needs.
Background: Promoting democracy is the highest USAID priority in Peru. A significant portion of the population has been marginalized, and democratic institutions have atrophied during a decade of terrorism, narco-trafficking and economic decay. Recent successes in addressing these problems provide a foundation for greater democratic development. Free and fair elections have been held. New judicial institutions have been established. Terrorism and narco-trafficking have receded. A democratic reform process has begun. The democratic development of Peru has moved steadily forward, albeit slowly, but has been dampened by an overly centralized government with limited political will to institutionalize democratic reforms and a lack of widely held civic values by the citizenry. The key development challenge is how to support and accelerate the process of rebuilding public confidence in participatory democracy, while strengthening democratic institutions. To address this challenge, USAID focuses on promoting effective human rights and democratic reform groups and more responsive local and central governmental institutions.
USAID Role and Achievements to Date: Recent USAID assistance has focused on electoral reforms, human rights, decentralization, and public accountability. Technical and financial assistance was provided to public and private sector institutions to develop and discuss democratic reforms issues, including a proposal for a new electoral law that is currently under debate in the Peruvian Congress. Almost 500 persons unjustly accused of terrorism have been released from jail, while pardons for 74 citizens were granted, as recommended by the Pardon Commission and the Ombudsman. Over 1,600 local mayors, council members, municipal employees and community leaders were trained in participatory methodologies. As a result, community participation in discussions of proposed legislation and the development of local infrastructure projects continues to increase. Community works committees in over 170 municipalities were formed, increasing their contribution of voluntary labor to public works from 24% in 1995 to 33% in 1996. Civic education activities continued promoting greater citizen awareness and involvement. Low income women debated publicly on gender opportunities and their civic rights and responsibilities. Some 20 Peruvian NGOs that work in promoting and strengthening Peru's democracy received management and strategic planning training. The U.S. Participant Training Alumni Association has developed into an active, nation-wide institution that promotes civic activities and transfers the experiences its members gained from training in the U.S.
Description: The USAID strategy is implemented through three projects, which mobilize citizen interest and support in making public institutions more responsive. The Participatory Democracy (PARDEM) project provides assistance to the GOP electoral bodies and non-governmental organizations (NGOs) to strengthen the electoral system, to the Controller General to improve public accountability, to local NGOs to promote civic awareness, and to Congress to improve its functioning and citizens outreach. The Justice Sector Support (JUST) project provides assistance to local human rights groups to defend those unjustly accused of terrorism, to inform citizens of their rights, and to promote the development of the Ombudsman Office. The Local Government Development (LGD) project supports the decentralization process by strengthening local governments --where most interaction between the State and citizens does and should occur -- and promoting community participation in governance.
In FY 1998, USAID will continue to focus on four areas: greater access to justice, greater civicawareness, more accountable public institutions, and more responsive local governments. To promote greater access to justice, USAID will continue to assist private human rights and democratic reform groups and GOP justice sector institutions. To achieve greater civic awareness, USAID will provide assistance in civic education and strengthening local NGOs. More accountable public institutions will be attained through continuing efforts to strengthen and consolidate the electoral reform system and key GOP electoral institutions, and by promoting the ability of congress to function as an effective and independent democratic institution. To foster more responsive local governments, activities will continue to strengthen local governments to promote community participation, and to assist in the development of appropriate legislation.
Host Country and Other Donors: For many years, USAID has been the major donor in the democracy sector. Recently, other donors have become more significantly involved in the sector, in part due to some increased GOP receptivity, USAID's ground-breaking in the justice and local government areas, and recognition of the importance of democratic reform as it relates to economic development. The World Bank (WB) is planning a large judicial modernization project ($25 million), which began in March 1996 with a $600,000 Japanese grant. The Inter-American Development Bank (IDB) is promoting alternative dispute resolution activities ($800,000), has provided over $2 million to its congressional support project, and may co-sponsor the World Bank judicial modernization project. The European Union (EN) is assisting in developing the Judicial Academy and is considering providing grants to local NGOs and human rights groups. The WB and IDB are designing several local government strengthening projects for a potential total of $240 million. The GOP is politically committed to this strategic objective. It has launched a judicial reform process and established and provided limited funding to key institutions (such as the Judicial Academy, the Ombudsman and the Judiciary Council). Significant direct contributions to the Controller General (CG) and Local Government Development projects are being provided under the framework of USAID/GOP bilateral agreements.
Beneficiaries: Although targeted, democracy activities tends to benefit a wide segment of the population. The most direct beneficiaries are individuals previously excluded from participating, human rights and democratic reform groups that implement activities and are being strengthened, local governments, key electoral bodies, the CG, the Ombudsman and congressional members and their staffs.
Principal Contractors, Grantees, or Agencies: USAID implements democracy activities through U.S. and local NGOs, the GOP Ministry of the Presidency, the Ombudsman, the Institute for National Development and the Peruvian Controller General Office.
Major Results Indicators: Baseline(1996) Target (2000)(a) Percentage of citizens that are active members of 15 40 at least one civil society organization.
(b) Valid votes cast as a % of eligible voters in elections. 60 90
(c) % of citizens satisfied with their opportunities to 10 30 participate in decision making at different levels of government.
ACTIVITY DATA SHEET PROGRAM: PERU
TITLE AND NUMBER: Increased Incomes of the Poor, 527-SO02
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998: $6,000,000 DA; $4,000,000 INCF; $48,917,000 P.L 480 Title II
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2001
Purpose: To provide access of the poor to income-generating opportunities which will result in reduced poverty and improved food security.
Background: Almost one-fifth of Peru's population is considered to be extremely poor (with insufficient income to provide minimum nutritional requirements), while almost one-half of the population is classified as poor (with insufficient income to provide the basic needs of food, clothing, shelter, and education). As a result of widespread poverty, the majority of Peruvians face serious food insecurity -- especially malnutrition among children less than 5 years of age. To remedy this situation, efforts will be focused on increasing incomes of the poor population. After several years of success in macroeconomic policy adjustments, the Government of Peru (GOP) is now focusing increased efforts on poverty alleviation and incorporation of the disenfranchised into the market economy.
Ongoing activities include providing support to: (1) microenterprises and small producers to identify market opportunities and develop market access strategies, and (2) NGOs and selected public sector institutions in the poorest regions of the country to strengthen their service delivery capacity in credit supply, production technologies, and small and microenterprise organization. To effectively reach the highly food insecure population (also extremely poor), USAID is focusing its P.L. 480 Title II program on nutritional rehabilitation of chronically malnourished children and on investments in basic productive infrastructure, appropriate technological improvements, and skills enhancement.
USAID Role and Achievements to Date: As a result of USAID assistance, channeled principally through private sector and not-for-profit organizations, value of agricultural products marketed increased by $29 million, value of non-agricultural products (apparel, shoes, handicrafts) marketed by microenterprises increased by $4 million, and corresponding employment increased by 13,700 full-time jobs. More than 1.3 million food-insecure Peruvians (two-thirds of which were children) participated in food aid assisted programs. Over 240,000 mothers participated in nutrition programs that targeted high-risk children under three years of age, while over 120,000 food-insecure families participated in food-for-work projects, including food production, storage, irrigation systems, soil terraces, potable water systems and health posts. Additionally, 26 rural NGOs representing over 120 communities were trained in financial management, administration, and strategic planning. A number of studies/analyses funded by USAID have resulted in an enabling policy environment. For example, a study on sub-contracting has facilitated the legal environment to permit small and microenterprises to subcontract their jobbing services to larger firms who have market access). Support provided to the Ministry of the Presidency influenced the development of the GOP's anti-poverty initiative and helped focus on GOP social investment resources on the extremely poor.
Description: USAID's major effort at strengthening the access of the poor to the market economy is focused on assisting microentrepreneurs and small farmers to identify market demand for their products, to utilize appropriate technology to efficiently produce these commodities, and to obtain financing and market links. Funding is being provided by USAID to analyze and improve the policy and regulatory framework to support increased participation by the poor in the market. Food assistance programs through NGOs provide support to the poorest populations in rural areas for nutritional improvement, especially through direct feeding programs for nutritionally at-risk children under the age of five. They also support temporary employment opportunities of the poorest populations, theimprovement of physical infrastructure, and the provision of inputs and credit to improve the production for on-farm household consumption. To assure the efficient utilization of these resources, NGOs are being strengthened.
Host Country and Other Donors: In 1996, the GOP has budgeted 44% of its total budget for social expenditures, principally through its corresponding sectoral ministries and its social investment program. The GOP's Financial Development Corporation (COFIDE) is providing considerable resources to finance agricultural and microenterprise activities. It managed $56 million in credit for the agricultural sector (from Inter-American Development Bank (IDB), Andean Development Corporation (CAF), USAID and its own budget), and $300 million for on-lending through Cajas Rurales. It also provided $300 million in credit through financial intermediaries to small and microenterprises (from IDB, CAF and Japan). USAID is channeling about $8 million through COFIDE for on-lending to agriculture while developing new financial mechanisms. The IDB and WB have contributed roughly $700 million to development of rural areas and $446 million in support of the education sector. The Japanese Government has pledged roughly $615 million the majority in soft loans, for infrastructure works in irrigation, sewage control, and rural roads. The World Food Program with whom USAID is closely collaborating on feeding programs, food policies, and food-assisted interventions, is another key donor. Other important donor development partners include the European Union, Switzerland, Canada and Germany.
Beneficiaries: Beneficiaries under this objective are poor people (households, small farmers, microentrepreneurs) who are located principally, but not exclusively, in the highland area of the country where poverty is the greatest. Over the next two years, beneficiaries will include 120,000 malnourished children being fed, 240,000 heads of household with temporary employment, 65,000 small farmers with improved production practices, 5,000 microentrepreneurs with new markets, and 3,000 women with access to credit.
Principal Contractors, Grantees, or Agencies: Principal implementors of USAID-funded activities are public sector ministries of Agriculture, Health and the Presidency; private sector Exporters Association and Businessmen's Association; U.S. PVOs, CARE, the Relief and Development Agency of the Adventist Church (ADRA), and Private Voluntary Agencies Collaborating Together (PACT); and local NGOs, CARITAS and the PRISMA Beneficial Association.
Major Results Indicators: Baseline Target(a) Value of expenditure per capita of the rural poor
Urban $507 (1994) $748 (2003)
Rural $204 (1994) $300 (2003)
(b) % of poor and extremely poor in the population
Poor 49.6 (1994) 40 (2002)
Extremely Poor 19.0 (1994) 10 (2002)
(c) Rate of chronic malnutrition 51.6 (1992) 32 (2002)
(In extremely poor Departments)
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Alternative Development, 527-Sp01
STATUS: New
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998 : $16,000,000 INCF
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2001
Purpose: To promote an adequate social and economic environment in target coca-growing and out-migration areas, in order to reduce coca cultivation pursuant to the GOP National Drug Prevention and Control Plan.
Background: The Alternative Development special objective directly supports the U.S. Government's Counternarcotics Strategy, a major U.S. foreign and domestic policy objective that aims to reduce the flow of illicit drugs into the U.S. This is a specialized program with broad-based objectives, which includes all sectors involved in sustainable development. Alternative Development is one of two major components of the U.S. counternarcotics strategy. The other component is law enforcement, which, alternative development activities, cannot achieve their purpose.
During 1982 - 1995, USAID was involved in alternative development in the Huallaga Valley. The current strategy was developed by drawing from lessons learned from pilot activities in the Ponaza Valley during an 18-month period from 1992 and 1993, where coca production was reduced over 50% by providing assistance for community-level, sustainable development activities. This approach was combined with the evolving U.S. and Peruvian counternarcotics strategies into a sustainable alternative development program, which was designed to reduce coca production in targeted areas by promoting licit economic opportunities and social development. Because of the political nature of this objective, its success or failure will depend upon the continued support of both the Peruvian and U.S. governments to reduce coca production to minimally tolerable levels.
There are two major activities included under this program: the Alternative Development project, which started in mid-1995, and the Narcotics Education and Community Initiative (NECI) project. The NECI project promotes drug awareness and demand reduction in both rural and urban areas and supports community initiatives in resolving problems related to illegal drug usage. It plays an important part in helping to create receptive attitudes to the negative effects caused by the illegal drug industry.
USAID Role and Achievements to Date: Many of the key implementation actions are well underway. A total of 226 communities have already signed voluntary coca reduction agreements, representing a commitment to reduce 15,000 hectares of coca, in exchange for assistance packages. Nearly 560 km of roads have been rehabilitated, opening up market possibilities for 350,000 people. Nine thousand land titles for 41,000 hectares have been issued, the first step for farmers to have access to production credit. Over 115 community development projects have been executed to benefit 24,000 families in the coca areas. Several important agricultural projects have commenced, which will also bear fruit for ex-coca farmers in the coming years as they switch to licit crops.
Through drug-awareness/demand reduction activities under the NECI project, over 50% of the population now recognizes drugs as one of Peru's major problems. USAID has played a donor leadership role in drug awareness and alternative development, and its strategy is recognized by the GOP and other donors as a viable activity promoting development and reducing coca production. To build on synergies and increase the overall impact, USAID has coordinated its programs for income and employment generation, health and nutrition, local governments and alternative development, environment, and food aid programs, to work in the same geographic areas. The NE
Description: Alternative Development project activities are being implemented in small watersheds in five major coca-growing areas, namely Central Huallaga, Upper Huallaga, Aguaytia, Pichis Palcazu and the Apurimac River Valley. Communities sign agreements with their local governments to voluntarily reduce coca production over time in exchange for economic and social development activities. These agreements are monitored by another U.S. Mission office (Narcotics Affairs Section), to ensure compliance and are expected to reduce coca production in target areas by at least 50% by the end of the project (FY 2000). The project has three major components: employment and income-generation; essential services and community development; and environmental protection and awareness. To ensure sustainability, the project will promote private sector investment, local government strengthening and community participation in the planning process, and implementation and maintenance of community-level activities. The drug awareness/demand reduction activity is working with rural communities where alternative development interventions are being implemented to help educate people against the use of illegal drugs and the damage that narco-trafficking causes to the social and physical environment.
Host Country and Other Donors: Among the GOP and other donors, the U.S. is regarded as the leader in alternative development, both in terms of strategy and in funding. USAID has established and maintained close relationships with the UN Drug Control Program, JICA/Japan, GTZ/Germany, and Canadian aid, and continues to coordinate periodically with these organizations in the planning and implementation of alternative development activities. Japan has invested $10 million in infrastructure and agriculture in alternative development areas, the GTZ will invest $4 million in alternative development projects in the Apurimac River Valley, a high priority area for USAID's special objective, and other donors are considering poverty alleviation investments in targeted alternative development areas. A close coordination role is also maintained with the WB and IDB, with the goal of developing support and coordination of activities within the alternative development target areas.
The GOP has identified alternative development as a high-priority activity and contributes with $14 million or 30% of the alternative development project costs. In 1996, the GOP established a Commission to coordinate all alternative development activities in Peru. Other U.S. Government agencies are assisting the GOP implement the law enforcement component of the counternarcotics strategy, which is having major successes against narco-traffickers, a key ingredient toward achieving the purpose of this special objective.
Beneficiaries: The direct beneficiaries of alternative development activities are 30,000 coca farm families who live in the project target areas; another 20,000 additional families will benefit who live in the geographic area, but are not actively involved in coca leaf production. Secondary beneficiaries include 50,000 families who live in the larger geographic areas where the target areas are located. They will benefit from improved security, better physical infrastructure, more responsive local governments, and increased licit economic opportunities.
Principal Contractors, Grantees, or Agencies: The National Development Institute, a unit of the GOP Ministry of the Presidency, has the overall implementation responsibility of the Alternative Development project activities. Primary implementors include local governments, communities, women's clubs, producers associations, and NGOs. The Winrock International-Agrarian Action consortium provides training and technical assistance to the program. The Center for Drug Education and Information (CEDRO) implements the drug awareness/demand reduction activity.
Major Results Indicators: Baseline Target(a) Coca reduction in target TBD (1996) 12,500-15,000 (2001) target areas (no. of hectares)
(b) Hectares devoted to licit crops 44,064 (1993) 63,208 (2000)
(c) Licit jobs created -- 9,000 (2000)
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Improved Health, including Family Planning, of High-Risk Populations, 527-SO03
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998; $23,193,000 DA
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2001
Purpose: To help low-income Peruvians, particularly children and women, enjoy longer lives and a higher quality of life make it easier for them to take appropriate preventive health actions, and support the development of sustainable health systems that ensure access to services.
Background: Despite recent accomplishments in health indicators at the national level, infant (children under 12 months) and child mortality and fertility rates remain unacceptably high among Peru's low-income populations in peri-urban and rural areas. The notification of AIDS cases is on the upswing and is increasingly characterized by infection at a younger age and more heterosexual transmission. Sexually-transmitted diseases are highly prevalent, with their treatment grossly inadequate. The GOP has embarked on a health sector reform that centers on equity, efficiency and quality. Improvements must be made in the supply side of health services (access to care and quality of care), the demand side (acceptance of services).
USAID Role and Achievements to Date: USAID supports child survival and family planning interventions, and a quick response to emerging diseases. As a result, infant mortality at the national level was estimated at 41 per 1,000 live births in 1994, a decline of 44% over the last decade. In the same timeframe, mortality of children under five was estimated at 58 per 1,000 children in 1994, a decline of over 45%. Nationwide, immunization coverage of infants exceeded 92% in 1995. Immunization trends for 1996 anticipate matching or surpassing 1995 vaccination rates. Nationwide, measles cases declined from 224 in 1995 to 64 in 1996. While whooping cough cases declined from 832 to 173 and neonatal tetanus cases dropped from 95 to 38.
Achievements in family planning are encouraging. Total fertility (average births per woman over a lifetime) declined 4.1 in 1986 to an estimated 3.3 in 1994. Couple years of protection (CYP) -- the generic way to measure contraceptive use and distribution -- reached 1,131,981 in 1995. In priority areas, where fertility rates far exceed the national average, contraceptive use increased in 1995 by ranges from 15% to 190%. Preliminary Ministry of Health (MOH) data estimate an annual increase of CYP for the public sector of 34% for 1996.
Description: Of the total funding requested for population and health, $XX,XXX,XXX is planned for population activities, and $X,XXX,XXX is planned for health activities. USAID's strategy takes an integrated, primary health care approach, focuses on decentralization and local non-governmental organizations, seeks to remove constraints to demand and improve quality of care, explicitly recognizes reproductive rights, and espouses a pluralistic approach to service provision.
Ongoing activities in family planning are aimed at the public and NGO sectors. USAID's support includes efforts to: (1) strengthen NGOs' capacity to maximize the supply of all family planning methods in urban, peri-urban and rural areas; (2) increase the sustainability of the supply of contraceptives; and (3) to disseminate information on family planning methods and services. USAID's support for the public sector is aimed at helping extend family planning programs in a quality manner. Ongoing activities in health and education are aimed at: (1) improving child survival services (such as immunization, nutrition and diarrheal control) and maternal health; and (2) strengthening and expanding the participation of public and private sector entities in HIV/AIDS prevention.
Via seven mutually- reinforcing activities in FY 1998, USAID will continue to support U.S. and local NGOs and Peruvian public-sector institutions in efforts to: (1) strengthen the quality of basic health care services, including immunization, family planning, oral rehydration therapy for diarrhea and related reproductive, maternal and child health services; (2) extend the coverage of, and increase the use of, these services by population groups in which mortality and fertility have remained high; (3) promote health in homes and communities; (4) encourage long-term sustainability by strengthening local organizations that deliver health services, including their ability to report and diagnose emerging diseases; (5) test new models of service delivery; (6) strengthen girls' education; and (7) promote safe sex, expanding the participation of public and private sector entities in HIV/AIDS prevention.
Host Country and Other Donors: USAID coordinates actively with other donors in Peru. Under an inter-agency committee for the immunization program, USAID (the major donor), UNICEF, the Pan American Health Organization (PAHO) and Rotary International plan together program activities with the MOH, which has progressively assumed the recurrent costs of annual immunization campaigns. Through a second committee, USAID, the WB and the IDB collectively coordinate with the MOH their health projects and debate policy issues and recommendations for reforms. The IDB project aims to strengthen national systems and the WB finances a health and nutrition project. Both are complementary to USAID projects. UNICEF supports micronutrient interventions in iodine deficiency, while USAID works actively in iron and vitamin A deficiency. The World Health Organization and PAHO provide focused technical assistance in policy and service delivery. USAID remains the largest donor in family planning, investing annually about seven times more than the second one, the United Nations Fund for Population Activities (UNFPA). UNFPA and the Overseas Development Administration (the United Kingdom bilateral agency) donate complementary contraceptives and fund small-scale activities in population research, management and service delivery. Japan, under the Common Agenda, is collaborating with USAID in the area of HIV/AIDS. Other bilateral donors, such as the Netherlands, Canada, Germany and France, as well as the European Union, hold regular meetings with USAID, particularly in reproductive health issues, following the Cairo and Beijing Plans of Action. Estimated host country counterpart contributions for the life of the strategic objective are $68,760,000.
Beneficiaries: Children under age five number 2.9 million, or 13% of the Peruvian population. Women of child-bearing age total 6.2 million and represent 27% of the national population. In sum, four of every 10 Peruvians fall in one of these two target groups. Some USAID projects have a regional focus, complementing the work of other donors. The population in these priority regions is seven million, or roughly one-third of the total population.
Principal Contractors, Grantees, or Agencies: USAID implements activities through several U.S. firms, U.S.-based private and voluntary and other not-for-profit organizations, and U.S. universities, as well as Peruvian NGOs, universities and the Peruvian Ministry of Health.
Major Results Indicators: Baseline Target(a)Infant mortality per 1,000 live births 73 (1986) 40 (2000)
(b)Mortality per 1,000 children under 5 years 106 (1986) 60 (2000)
(c)Percentage of infants fully 47% (1986) 95% (2000) vaccinated by age 1
(d) Total fertility rate 4.1 (1986) 3.0 (2000)
(e)Couple-years of protection (000s) 600 (1993) 1,823 (2000)
ACTIVITY DATA SHEET
PROGRAM: PERU
TITLE AND NUMBER: Improved Environmental Management in Targeted Sectors, 527-SO04
STATUS: Continuing
PROPOSED OBLIGATION AND FUNDING SOURCE: FY 1998: $3,400,000 DA
INITIAL OBLIGATION: FY 1995; ESTIMATED COMPLETION DATE: FY 2004
Purpose: To improve protection of the natural resource base, fragile ecosystems, and biodiversity conservation, and to reduce urban and industrial pollution.
Background: Peru is a country blessed with an abundance of natural resources and its diversity of habitats is one of the richest in the world. It has 81% of the total number of life zones on earth (84 of 104 total) and accounts for 22% of the earth's variations of flora an fauna. Peru's sustainable growth and environment, however, are hampered by rapid, uncontrolled urbanization and widespread poverty, which exerts destructive pressure over the country´s resources. Lack of adequate environmental policies and environmental awareness exacerbates dealing effectively with environment problems. USAID's strategy to address these problems focuses on: (1) improving the legal, policy, regulatory and normative environment and natural resource framework, (2) promoting pollution prevention in selected peri-urban and industrial settings, and (3) protecting natural resources including biological diversity and fragile eco-systems. USAID activities supporting this strategic objective include the Sustainable Environment and Natural Resources Management (SENREM), the Employment and Natural Resource Sustainability, and the Integrated Pest Management projects. In addition, USAID strategy is supported by innovative, potentially replicable pilot activities in mining and fishmeal industry pollution prevention, solid waste management in peri-urban areas, and comparative risk assessments, which contribute to address some of the most difficult and thorny environmental issues in Peru today.
USAID Role and Achievements to Date: Ongoing activities contributed to improving environmental management and conditions in Peru. Forty-three communities of the Pacaya Samiria National Reserve are now involved in sustainable income generation activities, and the GOP has increased park ranger staff by 217% and its annual financial contribution by 325% over the 1995 levels. The half-million-hectare Bahuaja Sonene National Park was created largely due to USAID/Peru's support for land classification and integrated development activities. Three women-owned solid waste collection microenterprises and one model sanitary landfill were established in Northern Lima, and a $1,500,000 donation from the EU will increase solid waste collection six-fold to serve 800,000 people. The Ministry of Industry's first environmental policy framework, and Peru's first that emphasizes principles/best practices for pollution prevention was drafted, albeit not yet approved. A nationwide poll designed to measure Peruvian attitudes and awareness of environmental and natural resources management issues was contracted out and data collection initiated. Through a high participatory process, Lima's first Environmental Health Comparative Risk Assessment was completed. Integrated pest management practices in 114 poor Sierra rural communities reduced agricultural losses by 32%, doubling its effectiveness over the 1995 levels.
Description: This program will be achieved through support for participatory policy debate, policy research and analysis, information dissemination and training, and development of innovative sustainable technologies in the green, brown and blue areas of the environment. Institutional capabilities of GOP and private sector organizations will be strengthened, aiming at mobilizing public support for environmental change, sound policies and effective legislation, and cost-effective practices. For example, the GOP's fledgling National Environmental Council (CONAM) is being provided with technical assistance to solidify Peru's environmental and natural resource legal and policy framework. GOP sectoral environmental units will be trained in the management of public participation processes and assessment methodologies. Research institutions will undertake analysis and outreach on environmental law and policy. National social and economic statistics will be published in an annual State of the Environment Report focusing on environmental trend analysis. Sector-specific (mining,fishing, and manufacturing) sustainable industry seminars will take place to discuss pollution prevention, incentives, and how private voluntary organization (PVOs) can support private industry initiatives. Municipalities will be trained in monitoring local environmental conditions, using low-cost techniques. Building on the Environmental Initiative for the Americas pilot activities, PVOs are being supported to develop successful and innovative practices in biodiversity and natural resources conservation, reduction of urban and industrial pollution, and improved water management. Results-oriented, sustainable activities with strong likelihood of replication throughout Peru will receive support. This will promote increased other donor investments to support sustainable environmental programs.
Host Country and Other Donors: Other donors are investing resources mainly in environmental health, conservation and reforestation areas, which will improve environmental conditions in Peru. The World Bank and Japan are providing $100,000,000 and $121,000,000, to rehabilitate Lima's water and sewage systems, respectively. The World Bank is also funding a wastewater treatment feasibility study that will lead to another loan to protect Lima's coastline, while channeling $5,000,000 through the Global Environment Fund to the National Fund for Protected Areas. The Inter-American Development Bank approved a $140,000,000 project to improve basic sanitation services provided by 36 provincial water and sewerage firms. The German Cooperation Agency is helping the GOP's National Institute of Natural Resources develop a master plan for protected areas. Other donor assistance includes UNDP support of Agenda 21; Food and Agriculture Organization aid for reforestation and rural education and financing him; the European Union, the Netherlands, and Switzerland for forestry, protected areas, and bio-diversity. Estimated host country contributions over the life of this strategic objective are close to $4,000,000.
Beneficiaries: Large segments of Peruvian population will ultimately benefit from improved environmental conditions resulting from an improved environmental and natural resource legal, regulatory and policy framework; private sector participation; and validated innovative technologies. However, the pilot activities will also directly benefit low-income, peri-urban and rural populations.
Principal Contractors, Grantees, or Agencies: Principal implementor of SENREM activity is the GOP´s National Environmental Council. Other activities are being implemented by The Nature Conservancy, the Peruvian Foundation for Nature Conservation, Conservation International, CARE, and the Potato International Center.
Major Results Indicators: Baseline (1996) Target (2002)(a) Percentage of public that perceives actions taken to improve environ- mental management. 10 30
(b) Protected areas management index. 15 40
(c) Percentage of solid waste properly 23 40 disposed of in legal sanitary landfills in Lima.
(d) Percentage of industrial 10 50 plants that have adopted valued-added pollution prevention measures.
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